I am an engineer, tech entrepreneur, innovator and adventurer whose passion is identifying undiscovered ideas and talent and amplifying them for maximum impact. I currently serve as an advisor to many organizations, including the Obama administration and the World Economic Forum. I’ve launched programs replicated globally, including the first TEDx in 2009, which has inspired 6,500 other events to date around the world. I founded two innovation centers at MIT and USC that helped spin out 39 startups based on university technologies and served as Vice Provost for Innovation at USC. My first startup was computer telephony pioneer, Stylus Innovation (acquired by Artisoft), and I later joined other tech and media startups, including Direct Hit Technologies (acquired by Ask Jeeves). I earned my master's and bachelor's in MechE at MIT. I am based in Los Angeles and in my spare time I am an avid traveler, skydiver, telemark skier, shark diver, mountain biker and authentic food aficionado.

Statistics like those can get policymakers very excited about supporting startups. In fact, last week, the World Economic Forum’s “Summer Davos” conference in Dalian, China focused a great deal on entrepreneurial ecosystems and increasing the startup rate worldwide.

Five years ago, entrepreneurs garnered little attention with policymakers. So this new trend should be music to my ears, given I’m the chair of the Forum’s Global Agenda Council for Fostering Entrepreneurship, and I’ve been part of the club banging the drum about entrepreneurship over a decade.

But it’s not. So why am I cautious about this newfound fervor around startups? Well, for a lot of reasons.

The numbers can be misleading. While it is true that new companies create jobs – there is no way to go from zero but up –job creation can quickly turn to job loss as startups enter their third and fourth years and on average contract or go out of business. Further, more recent employment data have found that startup rates have been declining and new firms are no longer contributing the way they used to. If anything, this means that young companies need more support than ever. But we need to accept that entrepreneurship is a high-risk game and set expectations accordingly.

Misplaced enthusiasm can drive investments in the wrong things. For example, on one of my Summer Davos panels, Economics Professor Mariana Mazzucato described how the UK annually spends more money ($8 billion) on funding startups and startup programs than what they spend on teachers or on universities. But it’s the fundamental, long-term investments in education and research that will provide a country with the basic building blocks to create successful and innovative enterprises; otherwise, startups won’t be worth investing in.

We should worry about scaling, not just starting. Looking at the recent exuberance about developing new tech clusters, you can see many accelerators, universities, and regions measuring success based on the number of companies that have launched. Meanwhile they don’t worry too much about which startups are poised to expand and make real impact. 40% of new companies die within the first five years, but it’s the ones that survive and grow that lead to job growth and that we should focus on.

Small doesn’t equal entrepreneurial. Dialogue about entrepreneurship policy often gets sidelined by small business interests, even though most small firms don’t actually contribute to employment growth. For example, 99% of companies in the US have revenue under $10 million, and only 23% of those have any payroll at all. High-growth startups, not small businesses, create new jobs. We shouldn’t conflate the two.

Entrepreneurship is contextual. Contrary to popular opinion, startups primarily drive innovation and economic growth in certain circumstances. A 2012 study by Sergey Anokhin and Joakim Wincent discovered that startup rates were positively correlated with innovation in only those countries that invested in research and development. So evangelizing entrepreneurship in a place that isn’t ready for it might actually do more harm than good; we must also promote research and development in these places.

We don’t always have the patience to see entrepreneurship through. Entrepreneurship drives economic growth, but it requires long-term patient investments in research, a culture that accepts failure, agile and skilled talent, and a resilient ecosystem that will enable workers and ideas to flow easily from one firm to the next. As a place like Silicon Valley demonstrates, this can take decades to develop, and most policymakers won’t wait that long for the results.

A focus on jobs alone undervalues the benefits of entrepreneurship. New ventures are critical for innovation because they can challenge the status quo. They are a breeding ground for new ideas and new talent. They are a key component for competitiveness globally. And for many, they can provide a path to economic independence and therefore can serve as a driver for democracy globally. But governments and advocates who buy into the myth that startups are a quick fix for unemployment are likely to lose interest before their investments bear fruit.

The truth is, over-exuberance can lead to disappointment. So while I do in fact believe that entrepreneurship is a critical and positive force for the world, we need to proceed cautiously when we evangelize about it. I worry if we promote it as a short-term panacea for all our economic ills, our startup-mania will go as quickly as it came, leaving behind a hodge-podge of failed programs and disgruntled taxpayers and investors, and poisoning the well for future entrepreneurial opportunities.

We need to recognize that a bunch of new startups won’t create sustainable jobs overnight. But as long as we’re in it for the broader vision and the long haul, it’s certainly the way to start. Because every Global 2000 company was once a startup.

Follow Z Holly on Forbes here and on Twitter (@krisztinaholly) for more insights on the future of creativity, innovation, and entrepreneurship.

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I find your article very disturbing because you talk mostly about the world economy. I want to fix the US economy with startups. The citizens of this country have been free to practice private enter prize for over 200 years and private enterprise has made this country the greatest ever on the planet. Would you agree with that? There are millions of US citizens as well as citizens of other countries who would love to immigrate to this country just to start a business. All of these people will need financial assistance and in most cases none is available. I therefore call for the creation of a National Job Creation Bank patterned after the Import/export bank which was created by presidential executive order to create funding for other countries to buy US exports. Of course this idea would be fought tooth and nail by large corporations afraid of competition and it would never survive without the complete support of the President. My goal would be to create 2000000 (2 million new startups) per year. These would create 6 million new jobs per year. 40 percent will fail but that money will be pumped into the economy,not sent out of the country. If we do this each year think of the tax base that will be increased. Many of these startups will become large companies with more job growth. So you see I don’t agree with your assessment Stop worrying about the global job picture and concentrate on the US

Hi rayban1, Thanks for sharing your thoughts! A strong economy overseas will create a bigger market for US products, so we shouldn’t be against global economic growth. This isn’t a zero sum game.

That said, let’s focus on our country. I agree we should support entrepreneurship in the US, absolutely.

Part of my concern is that investors and policymakers are focusing too much on the short-term when they should be looking at the broader and longer-term benefits of startups. I see a huge entrepreneurship bubble in the US as well. Way too many accelerators and incubators these days looking for the next Google or Facebook; most of them will be disappointed. The majority of the new ventures I see pitching these days are not worth investing in.

Absolutely, startups are a really critical component to our recovery. But we have to be careful about too much hype and not enough substance, or in two years time entrepreneurship might become a dirty word. And that would be a real tragedy to those of us that want to see more entrepreneurial companies grow and succeed! Z

Thank you for your reply but you didn’t address my thought about trying to create 2 million start-ups each year and I truly believe (you can confirm this) that the average new startup will produce 3 jobs. If that is indeed true then 2 million start-ups will produce 6 million jobs. Think of the psychological impact on the nation. Unfortunately everyone is concentrating on creating the next Microsoft. What about all the regular types of businesses that line mainstreet USA? They need assistance also but venture capitalists aren’t interested in mom and pop businesses and the banks can only think of gambling on derivatives. That’s why I call for a national job creation bank. If you would please address these issues I would be most appreciative.

Hi rayban1, I’d be very curious to learn more about the national job creation bank. How are you proposing to invest the money?

While I’m not sure that investing in mom-an-pop businesses is the right angle (see one of my links above, about small businesses), but I agree that there are many companies that, while they aren’t the next Microsoft, they are going to be solid employers that need support and are being ignored. The current venture capital model isn’t working for most companies.

I would be interested to hear about how you envision the government would invest money to create 2 million startups. How much money would it take? What form would ittake: equity, loans, matching funding, research grants? Who would manage it and how would the decisions be made? I can’t comment much until I hear more details, but I’m curious to hear more!

Hi Z Mom and Pop type business are the key to creating 2 million startups per year. They will also be the key to a robust private enterprise economy. All of the infrastructure is already in place via the SBA. The loan officers would be the SBA offices around the country.`To be eligible for a loan all you would need is $25,000 of your own money AND a viable business plan. If your plan does not prove out then your business will never make it. The money would come from selling shares to the Billionaires in this country or any country. Each loan would give 10 % of the created business to the Bank. This would allow the bank to perpetuate itself. I understand the concept of creative destruction which is a given. failures would last at least one year but all of the money would go into the local economy instead of in the pockets of corrupt administrators

Z, how do you think this country grew into the most productive and creative country ever on the planet? We must provide the conditions that foster an environment that compares to that of 75 years ago. Right now we are gasping for air due to very tight money and over regulation and taxation.